BroadChain News, April 24, 18:06 - Michael Saylor's "debt-to-buy-BTC" perpetual motion machine is facing a risk of stalling. On April 14, Strategy's perpetual preferred stock STRC fell below its $100 par value on Nasdaq, hitting a low of $99.06, with trading volume plummeting to 47% of normal levels, and has since remained in a discount range.
The financing efficiency of STRC directly determines whether Strategy can continue to increase its Bitcoin holdings. Once it falls below par value, it means that Saylor's channel for drawing funds from traditional markets via the ATM (at-the-market offering) mechanism to buy Bitcoin will be temporarily closed. As the digital asset treasury company holding the most Bitcoin globally, losing this most important incremental funding source poses a threat to marginal buying support in the Bitcoin market.
STRC offers a locked high yield of 11.5%, aimed at maintaining its trading price near $100 to ensure the company can continue to raise funds through ATM. Since its launch in July 2025, STRC has seen seven consecutive months of dividend increases, rising from an initial annualized dividend of 9% to 11.5%. A steady stream of investors seeking stable high yields has kept STRC above par value for an extended period, allowing Saylor to convert traditional market funds into Bitcoin purchasing power.
Saylor has abandoned the traditional capital market's net profit valuation model, instead adopting the "Bitcoin Gain" metric—defined as the percentage increase in Bitcoin holdings per common share—to define Strategy's value as a "Bitcoin-standard" company. In the first quarter of 2026, Strategy achieved a Bitcoin gain of 6.2%, with a full-year target of 9.5%. STRC is the leverage tool to achieve this goal: by issuing preferred stock with fixed financing costs to buy Bitcoin, which has long-term appreciation potential.
However, this flywheel has derailed under a double blow. The Iran situation has led to shipping disruptions in the Strait of Hormuz and surging oil prices, pushing up inflation expectations, with the market delaying expectations for a Fed rate cut from mid-2026 to 2027. For STRC, which has strong bond-like attributes, persistently high benchmark interest rates have diluted the appeal of its 11.5% dividend. Meanwhile, the crypto market Fear and Greed Index once fell to 9, entering "extreme fear" territory, prompting funds to dump non-core assets, with the less liquid STRC bearing the brunt.
The dividend decision on April 1 became the last straw. Strategy announced it would maintain the 11.5% dividend but ended seven consecutive months of monthly increases. The market interpreted this as the company's financing capacity peaking and a loss of confidence in Bitcoin's subsequent rise. Retail investors account for up to 80% of STRC holders, and their panic selling accelerated the price drop below par value.